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Atradius Payment Practices Barometer

International survey of B2B payment behaviourStatistical appendix for Asia Pacific

RESULTS NOVEMBER 2014

ATRADIUS PAYMENT PRACTICES BAROMETER – RESULTS NOVEMBER 20142

Asia Pacific: proportion of total B2B sales made on credit 3

Average payment terms recorded in Asia Pacific (average days) 4

Asia Pacific: proportion of total B2B receivables by payment timing 5

Asia Pacific: main reasons for payment delays

by domestic B2B customers 6

Asia Pacific: main reasons for payment delays

by foreign B2B customers 7

Credit management policies used by respondents in Asia Pacific 8

Average DSO recorded in Asia Pacific 9

Average DSO becomes a reason for concern

for respondents in Asia Pacific 10

The greatest challenge to business profitability in 2014 for

respondents in Asia Pacific 11

Statistical appendix


Sample: all interviewed companies Source: Atradius Payment Practices Barometer – November 2014

Asia Pacific: proportion of total B2B sales made on credit

20% - 40%

40% - 60%

Hong Kong

47.9 Taiwan

49.6

Singapore

51.5 Indonesia

49.4

Japan

59.3

Australia

49.2

India

42.6

China

38.4

Asia Pacific 48.4%Americas 43.0%Europe 44.9%

By industry / by business size

Total Industry Business size

Asia Pacific ManufacturingWholesale / Retail

/ DistributionServices Micro-enterprises SMEs Large enterprises

48.4% 47.9% 49.4% 48.2% 50.7% 47.3% 47.4%

Sample: all companies interviewed Source: Atradius Payment Practices Barometer – November 2014


Average payment terms recorded in Asia Pacific (average days)

percentage average days

Asia Pacific 66.2 23.8 6.7 3.3 34

Americas 74.5 20.3 4.40.8 28

Europe 74.3 18.3 5.4 2.1 31

Australia 81.7 15.5 2.40.5 23

Singapore 77.4 16.8 5.8 29

Hong Kong 73.2 20.9 4.6 1.4 29

Indonesia 80.7 14.5 2.9 1.9 31

India 62.0 29.3 5.8 2.9 35

Taiwan 54.6 30.6 12.4 2.4 39

China 53.9 31.1 8.2 6.9 41

Japan 46.2 31.7 12.0 10.1 49

1 - 30 days 31 - 60 days 61 - 90 days Over 90 days



Industry Business size

ManufacturingWholesale / Retail


1-30 days 61.2% 70.2% 68.0% 76.4% 62.0% 57.8%

31-60 days 26.5% 21.2% 23.3% 15.7% 28.1% 27.4%

61-90 days 8.8% 4.9% 6.2% 5.6% 7.0% 8.4%

Over 90 days 3.6% 3.7% 2.5% 2.3% 2.9% 6.5%

Average days 36 32 34 31 35 40



Overdue(% of total value of

credit sales)

Uncollectable(% of total value of

receivables)

Asia Pacific 36.2% 2.2%

Americas 38.4% 2.7%

Europe 36.4% 1.6%

Japan 23.3% 0.3%

Taiwan 36.6% 2.2%

Hong Kong 38.8% 2.2%

Singapore 41.5% 2.4%

China 34.3% 2.5%

Australia 37.4% 2.5%

Indonesia 37.1% 2.6%

India 40.4% 2.9%

1- 30 days

Average DSO in the Americas

Sample: companies interviewed (active in domestic and foreign markets)Source: Atradius Payment Practices Barometer – September 2014

Percentageaverage days

48

31-60 days 61-90 days Over 90 days

Cash sales

Average total value of B2B receivables by payment timing in Asia Pacific

Sample: companies interviewed (active in domestic and foreign markets)Source: Atradius Payment Practices Barometer – November 2014

Credit sales Uncollectable = 2.2%

Paid on time

Overdue

48.451.6

36.2

63.8

The greatest challenge to business profitability this year – the Americas


Falling demand for your products and services

Maintaining adequate cash flow

Collecting outstanding invoices

Bank lending restrictions

26.5%

31.0%

22.5%

20.0%

Most often used credit management policies in the Americas


Buyer‘s creditworthiness check

Request secured forms of payment

Monitor buyer‘s credit risk

50.2%

50.2%

47.5%

Percentage

64.1 17.8 5.5 12.6

Asia Pacific: proportion of total B2B receivables by payment timing





Overdue 37.8% 37.4% 33.5% 32.9% 37.4% 39.0%

Uncollectable 2.5% 2.3% 2.0% 2.1% 2.2% 2.6%



Asia Pacific: main reasons for payment delays by domestic B2B customers

Insufficient availability

of funds

Dispute over quality

of goods delivered or service provided

Goods delivered or service provided

do not correspond to what was

agreed in the contract

Complexity of the

payment procedure

Inefficien-cies of the banking system

Incorrect information on invoice

Buyer using outstanding

debts / invoices as a form of financing

Formal insolvency

of the buyer (example:

liquidation, receiership, bankruptcy)

Invoice was sent to wrong person Other

Asia Pacific 47.3% 32.0% 24.4% 30.0% 26.2% 25.7% 30.7% 26.9% 19.2% 2.4%

Americas 46.8% 21.4% 22.0% 28.3% 28.9% 26.3% 28.3% 26.1% 21.4% 4.3%

Europe 49.5% 15.4% 12.3% 16.4% 16.0% 15.1% 29.4% 21.6% 11.6% 7.6%

Australia 43.3% 18.5% 16.9% 23.0% 28.1% 21.4% 25.8% 15.2% 21.9% 9.6%

China 67.1% 36.5% 24.7% 36.1% 30.6% 22.4% 38.4% 32.9% 15.1% 0.5%

Hong Kong 49.5% 38.7% 24.0% 31.9% 24.5% 26.0% 22.1% 31.4% 21.6% 1.0%

Taiwan 42.2% 46.7% 28.1% 27.6% 20.1% 32.2% 29.2% 32.2% 18.6% 0.5%

Singapore 41.9% 31.2% 23.1% 30.7% 23.1% 26.3% 29.0% 20.4% 19.4% 0.5%

Indonesia 50.8% 31.2% 25.1% 29.7% 30.7% 23.1% 36.7% 33.7% 23.6% 1.0%

Japan 16.9% 16.2% 18.3% 16.2% 13.4% 21.8% 18.3% 17.6% 7.8% 7.8%

India 54.8% 30.2% 32.7% 39.2% 34.7% 31.2% 41.2% 26.6% 23.1% 1.0%

Industry

Manufacturing 48.9% 32.4% 26.9% 31.1% 27.1% 26.7% 30.4% 27.8% 20.0% 1.8%

Wholesale / Retail / Distribution

48.6% 33.6% 21.5% 28.2% 24.2% 21.9% 32.4% 26.6% 18.3% 1.3%

Services 44.4% 30.3% 24.4% 30.3% 26.8% 27.8% 29.5% 26.1% 19.1% 4.0%

Business size

Micro-enterprises 46.5% 27.1% 21.7% 24.4% 22.5% 18.7% 25.8% 23.2% 14.1% 4.5%

SMEs 49.1% 33.9% 26.2% 33.0% 28.7% 27.6% 32.0% 26.9% 20.6% 1.5%

Large enterprises 42.9% 35.6% 24.3% 31.2% 25.1% 33.6% 36.0% 34.0% 24.7% 1.2%

Sample: all interviewed companies (active in domestic markets) Source: Atradius Payment Practices Barometer – November 2014


Asia Pacific: main reasons for payment delays by foreign B2B customers

Insufficient availability

of funds

Dispute over quality

of goods delivered or service provided

Goods delivered or service provided

do not correspond to what was

agreed in the contract

Complexity of the

payment procedure

Inefficien-cies of the banking system

Incorrect information on invoice

Buyer using outstanding

debts / invoices as a form of financing

Formal insolvency

of the buyer (example:

liquidation, receiver-

ship, bank-ruptcy)

Invoice was sent to wrong person Other

Asia Pacific 34.5% 34.1% 28.6% 40.0% 33.1% 27.6% 29.8% 25.7% 22.2% 1.8%

Americas 37.3% 23.4% 20.7% 33.5% 33.0% 25.5% 22.6% 28.2% 25.5% 3.0%

Europe 35.7% 19.0% 16.1% 23.9% 23.8% 17.6% 23.6% 18.3% 14.4% 8.5%

Australia 31.5% 25.9% 25.9% 28.7% 25.9% 21.3% 29.6% 25.9% 28.7% 6.5%

China 35.9% 46.7% 29.2% 55.9% 36.9% 28.7% 32.3% 20.5% 20.0% 1.0%

Hong Kong 38.6% 31.3% 24.4% 34.1% 27.8% 29.0% 27.8% 23.3% 22.2% 1.1%

Taiwan 33.3% 41.7% 32.1% 41.1% 29.8% 22.0% 29.2% 32.1% 19.1% 1.2%

Singapore 36.4% 29.1% 25.2% 31.1% 34.4% 33.8% 29.8% 21.9% 18.5% 1.3%

Indonesia 32.9% 27.0% 27.7% 41.6% 39.4% 25.6% 25.6% 33.6% 22.6% 1.5%

Japan 12.8% 19.2% 23.4% 23.4% 23.4% 19.2% 27.7% 12.8% 8.5% 4.3%

India 37.4% 34.5% 35.1% 44.8% 38.5% 32.8% 33.9% 28.2% 29.9% 1.2%

Industry

Manufacturing 33.1% 37.8% 27.4% 42.0% 28.9% 27.2% 31.6% 25.6% 21.4% 1.9%


35.0% 32.1% 33.2% 37.9% 32.7% 25.0% 29.1% 26.5% 22.1% 1.5%

Services 36.1% 30.8% 25.4% 39.1% 39.7% 30.8% 28.1% 25.1% 23.3% 2.1%

Business size

Micro-enterprises 32.8% 32.4% 29.3% 35.5% 34.1% 23.5% 26.6% 23.8% 16.9% 3.5%

SMEs 35.8% 33.8% 29.4% 41.0% 33.4% 27.3% 30.5% 25.0% 23.4% 1.4%

Large enterprises 32.9% 37.1% 24.9% 42.7% 31.0% 34.3% 32.4% 30.5% 25.4% 0.9%

Sample: all interviewed companies (active in domestic markets) Source: Atradius Payment Practices Barometer – November 2014


Credit management policies used by respondents in Asia Pacific

Reserve against bad

debts Self insure

Send payment

reminders (dunning)

Retain a collections

agencySell on cash

terms

Check buyer’s credit-

worthiness

Monitor buyer’s credit

risk

Request secured forms of payment

Diversify customer

base

Asia Pacific 39.1% 35.2% 26.1% 29.6% 35.8% 51.9% 48.9% 51.0% 31.1%

Americas 37.7% 37.3% 21.7% 30.4% 33.9% 50.2% 47.5% 50.2% 33.3%

Europe 30.2% 20.7% 52.0% 28.5% 31.8% 43.1% 35.9% 34.9% 22.8%

Australia 39.6% 34.5% 19.4% 33.8% 33.1% 43.2% 41.7% 44.6% 25.9%

China 40.5% 47.8% 34.8% 33.2% 36.0% 58.4% 59.6% 65.2% 29.2%

Hong Kong 39.0% 38.2% 26.5% 24.3% 31.6% 42.7% 41.2% 37.5% 36.0%

Taiwan 35.9% 46.5% 38.7% 34.5% 36.6% 52.8% 51.4% 54.2% 26.8%

Singapore 41.7% 32.3% 14.2% 28.4% 34.7% 56.7% 54.3% 48.0% 33.9%

Indonesia 31.8% 5.7% 27.2% 24.5% 36.4% 56.3% 49.0% 60.9% 28.5%

Japan 40.0% 25.0% 31.3% 13.8% 36.3% 53.8% 37.5% 25.0% 31.3%

India 44.4% 43.8% 16.7% 35.8% 40.7% 50.6% 48.8% 55.6% 37.7%

Industry

Manufacturing 38.2% 37.7% 28.6% 30.4% 40.5% 52.9% 48.7% 50.8% 33.0%


29.8% 20.2% 15.5% 21.4% 29.8% 46.4% 41.7% 51.2% 19.1%

Services 37.8% 37.2% 28.2% 30.9% 35.1% 47.9% 52.1% 51.6% 34.0%

Business size

Micro-enterprises 31.0% 28.9% 17.8% 21.3% 32.8% 44.3% 40.8% 49.8% 22.0%

SMEs 40.7% 36.6% 27.3% 32.0% 35.6% 53.3% 49.9% 49.8% 32.6%

Large enterprises 45.7% 39.7% 34.2% 34.2% 40.7% 58.8% 57.3% 56.8% 39.7%

Sample: all interviewed companies (active in domestic and foreign markets) Source: Atradius Payment Practices Barometer – November 2014


Average DSO recorded in Asia Pacific

percentage average days

Asia Pacific 60.8 20.3 4.8 14.1 54

Americas 64.1 17.8 5.5 12.6 48

Europe 56.2 23.7 8.2 12.0 50

Australia 76.1 14.2 3.7 6.0 31

Hong Kong 69.5 17.7 6.1 6.7 37

Japan 53.5 29.6 4.2 12.7 43

Singapore 65.9 18.8 5.8 9.4 47

Taiwan 54.5 27.5 8.4 9.6 49

China 55.3 27.4 4.2 13.2 52

India 61.1 19.3 6.4 12.9 65

Indonesia 60.1 13.8 3.6 21.6 100

1 - 30 days 31 - 60 days 61 - 90 days Over 90 days




ManufacturingWholesale / Retail /

DistributionServices Micro-enterprises SMEs Large enterprises

53 57 53 55 53 57



Average DSO becomes a reason for concern for respondents in Asia Pacific, when it is ... days longer than the payment term

percentage

Asia Pacific 28.6 33.8 20.2 9.8 7.6

Americas 25.3 34.1 22.9 11.9 5.8

Europe 23.2 29.6 22.0 12.8 12.6

China 21.1 43.1 26.2 6.0 3.7

Hong Kong 26.0 37.3 19.1 10.8 6.9

Taiwan 27.3 35.9 16.2 10.1 10.6

India 27.9 35.0 22.8 10.2 4.1

Singapore 28.1 25.0 26.0 13.5 7.3

Australia 31.1 30.5 21.6 9.5 7.4

Indonesia 33.0 32.5 12.5 9.5 12.5

Japan 38.8 27.3 14.9 9.1 9.9

1 - 30 days 31 - 45 days 46 - 60 days 61 - 90 days Over 90 days






1-30 days 26.4% 28.0% 31.3% 37.0% 24.3% 25.5%

31-45 days 32.8% 35.3% 33.6% 32.6% 35.2% 31.5%

46-60 days 23.4% 18.4% 18.3% 15.9% 22.6% 20.9%

61-90 days 10.1% 10.7% 8.8% 7.4% 11.1% 10.2%

Over 90 days 7.3% 7.6% 8.0% 7.0% 6.7% 11.9%



The greatest challenge to business profitability in 2014 for respondents in Asia Pacific

percentage

Asia Pacific 32.3 35.6 18.1 14.0

Americas 26.5 31.0 22.5 20.0

Europe 32.2 32.4 21.8 13.6

Japan 43.8 31.3 15.9 9.1

China 38.4 39.3 11.9 10.5

Taiwan 35.4 43.5 12.0 9.1

Indonesia 30.9 32.9 22.7 13.5

Australia 29.6 36.2 18.3 16.0

Hong Kong 28.6 36.4 17.3 17.7

India 26.9 33.7 21.2 18.3

Singapore 24.5 31.7 26.0 17.8

Falling demand for products and services

Maintaining adequate cash flow

Collecting outstanding invoices

Bank lending restrictions

Sample: all interviewed companies (active in domestic and foreign markets) Source: Atradius Payment Practices Barometer – November 2014





Falling demand 30.7% 31.6% 34.3% 33.0% 32.7% 29.3%

Adequate cash flow 36.4% 34.5% 35.9% 37.4% 34.0% 37.3%

Outstanding invoices collection 16.2% 20.6% 17.9% 17.8% 18.1% 18.6%

Bank lending restrictions 16.7% 13.3% 11.9% 11.7% 15.3% 14.8%


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Phone: +31 20 553 9111

[email protected] www.atradius.com

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